DIRECTORS' REPORT To The Members, 1. Your Directors have pleasure in presenting their Thirtieth Report together with the Audited Financial Statement of Accounts for the year ended on March 31, 2015. 2. PERFROMANCE & OPERATIONS : Gross sales income during the year under review was Rs.21,800.75 Lacs. The net Profit of the company for the fiscal 2014- 2015 is Rs.156.36 Lacs. Air conditioners continue to contribute in increasing the gross sale & profit of the company. 3. MANAGEMENT DISCUSSION ANALYSIS AND CORPORATE GOVERNANCE : The Management Discussion Analysis and the report on Corporate Governance are attached to the Directors' Report and form parts of this Annual Report. A Certificate from a Company Secretary in whole time practice verifying compliance thereof is also incorporated in the Corporate Governance section. 4. CERTIFICATES AND MARKS: Your Company continues to be an ISO 14001 and ISO 9001 certified Company. 5. INDUSTRIAL RELATIONS: During the year ended March 31, 2015 the industrial Relations were harmonious and cordial 6. AUDITORS: i) Statutory Auditors: The members in their 29th Annual General Meeting held on 22nd September 2014 have appointed M/s. S R B C & Co LLP, Chartered Accountants, as the Statutory Auditors of the Company from the conclusion of 29th annual general Meeting up to the conclusion of 32nd annual general meeting of the Company for a period of three years. The appointment of M/s. S R B C & Co LLP, Chartered Accountants, as the Statutory Auditors of the Company will be placed for ratification by the shareholders as per the first proviso to Section 139 of the Companies Act 2013. Members are requested to consider the ratification of the appointment of the Statutory Auditors and authorize the Board to fix their remuneration. ii) Cost Auditors: The Board of Directors have appointed Mr. Chandrashekhar.S. Adawadkar , Practicing Cost Accountant, to conduct the Cost Audit of the Company for the financial year ending on 31st March, 2016 upon recommendation of the Audit Committee . The Remuneration payable to the Cost Auditors for the financial year 2015-2016 requires ratification by the members of the Company. The same is put before the members of the company for their consideration and approval. Cost Audit was not applicable to your Company for the Financial year 2014-2015 iii) Secretarial Auditors: Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company appointed M/s. S.V.Deulkar & Co., Company Secretaries as the 'Secretarial Auditors' of the company for the financial year 2014-2015. They have resigned as the Secretarial Auditors of the Company for the financial year 20142015. In place of M/s. S.V. Deulkar & Co, Practicing Company Secretaries, the Board appointed M/s. SVD & Associates, Practicing Company Secretaries as the Secretarial Auditors of the Company with effect from 7th February 2015 to audit the secretarial records of the Company for the financial year 20142015. The Secretarial Audit Report given by M/s. SVD & Associates, Practicing Company Secretaries for the financial year 20142015 is annexed as Annexure - C. The Auditors' Report and the Secretarial Audit Report for the financial year ended 31st March, 2015 do not contain any qualification, reservation, adverse remark or disclaimer. 7. EXTRACT OF ANNUAL RETURN The details forming part of the extract of Annual Return in Form MGT - 9 is annexed herewith as 'Annexure - A' to this Report. 8. NUMBER OF MEETINGS OF THE BOARD During the year under review, Four Board Meetings were convened and held. The details of which are given in the Corporate Governance Report. 9. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirements of Section 134 (1) (c) and 134(5) of the Companies Act, 2013, in respect of Directors' Responsibility Statement, it is hereby confirmed that: a) in the preparation of the annual accounts for the financial year ended on 31st March 2015 , the applicable accounting standards have been followed and that there are no material departures; b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period; c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) the Directors had prepared the annual accounts on a going concern basis; e) the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; f ) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. 10. A STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS: All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. 11. COMPANY'S POLICY ON DIRECTORS' APPOINTMENT , AND REMUNERATION INCLUDING CRETERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES AND INDEPENDENCE OF A DIRECTOR : The Board had on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Key Managerial Personnel and Senior Management Personnel and their remuneration. The policy is annexed herewith as 'Annexure - B' to this Report. Criteria for Determining Qualifications, Positive Attributes & Independence of Director (Evaluation Criteria): i. Qualifications of Director: A director shall possess appropriate skills, experience and knowledge in one or more fields of engineering, finance, law, management, sales, marketing, administration, research, corporate governance, operations or other disciplines related to the Company's business. ii. Positive attributes of Directors: A director shall be a person of integrity, who possesses relevant expertise and experience and who shall uphold ethical standards of integrity and probity; act objectively and constructively; exercise his responsibilities in a bona-fide manner in the interest of the Company; devote sufficient time and attention to his professional obligations for informed and balanced decision making; and assist the Company in implementing the best corporate governance practices. iii. Independence of Independent Directors: An Independent director should meet the requirements of the Companies Act, 2013 and Clause 49 of the Listing Agreement concerning independence of directors." 12. EXPLANATIONS OR COMMENTS BY THE BOARD ON EVERY QULIFICATION , RESERVATION OR ADVERSE REMARKS OR DISCLAIMER MADE (1) BY THE AUDITOR IN HIS REPORT (2) BY THE COMPANY SECRETARY IN PRACTICE IN HIS SECRETARIAL AUDIT REPORT : There are no qualifications, adverse remarks or disclaimer made by the statutory auditors or company secretary in practice in their respective audit reports. 13. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013: The Company has not given any loans, guarantees or has not made any investments during the financial year 2014-2015 under review. 14. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SUB SECTION (1) OF SECTION 188 IN THE PRESRIBED FORM: All contracts or arrangements entered in to by company with related parties have been done at arm's length and are in ordinary course of business. As per the provisions of Section 134 of the Companies Act 2013 read with Rule 8(2) of the Companies (Accounts) Rules the particulars of such transactions are provided in the Form AOC-2 which is annexed herewith as 'Annexure- E' to this report. The policy on related party transaction as approved by the Board has been displayed on the website of the Company www.sharpindialimited.com . 15. THE STATE OF THE AFFAIRS OF THE COMPANY : State of Company's affairs has been covered as part of this report under the 'financial results' & Management Discussion and Analysis (MDA). 16. THE AMOUNT , IF ANY, WHICH, THE COMPANY PROPOSES TO CARRY TO ANY RESERVES : Nil 17. THE AMOUNT, IF ANY, WHICH THE COMPANY RECEOMMENDS SHOULD BE PAID BY WAY OF DIVIDEND : Nil. 18. MATERIAL CHANGES AND COMMINTMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT : There was no production of LED TVs since April 2015 and of Air Conditioners since June 2015 in the absence of any orders. 19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO etc.: Conservation of Energy & Technology Absorption etc.: Your Company has taken various measures to conserve the energy and places very much importance for the conservation of energy and is conscious about its responsibility to conserve energy, power and other energy sources and has taken necessary steps to conserve the same. The company continued its efforts to improve its energy usage efficiency. It lays great emphasis towards a safe and clean environment and continues to adhere to all regulatory requirements and guidelines. Your company strongly and religiously follows and practices the 3E Policy i.e. - a) Eco-positive Product - Products having less usage of resources and are safe for use, b) Eco-positive Operation - Reduce adverse impact on environment during Manufacturing processes c) Eco-positive Relationship - Enhance corporate value during involvement of Employees Even though the nature of company's operations is not energy-intensive, in line with the company's commitment towards conservation of energy, all departments in the company continue with their efforts aimed at improving energy efficiency through improved operational and maintenance practices. The steps taken in this direction by your company are as given below: (1) make constant efforts to reduce consumption of energy, light, oil, water & fuel in following ways: (i)Reduction of energy consumption by turning off lights, personal computers , fans and other electronic equipments when not in use; (ii)Timely maintenance and up-gradation of machinery & equipments;(iii)Plantation of trees in the factory (v).Awareness programs towards optimum utilization of natural resources at managerial as well as employee level; (v) Timely repairs & maintenance of water taps in the factory. The in-house development of new models of LCD TVs & newly introduced Inverter type split Air conditioners (ACs) is supported by strong overseas technical knowledge from Sharp Corporation, Japan. The technology provided by Sharp Corporation, Japan is being absorbed and the company continues to utilize the same. 20. RISK MANAGEMENT POLICY: The Company has adopted a Risk Management Policy in accordance with the provisions of the Companies Act 2013 and Clause 49 of the Listing Agreement. The company has setup a Risk Management Committee duly approved by the Board of Directors. The Committee identifies all strategic, operational & financial risks by analyzing and assessing the operations of the company. The Risk management report giving details of risks identified along with measures adopted to control the risks, is placed before the Board & Audit Committee quarterly for their evaluation & suggestions. 21. CORPORATE SOCIAL RESPONSIBILITY POLICY: This policy is not applicable to the Company at present. 22. MANNER OF ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OF DIRECTORS: As per the policy and criteria laid down by the Nomination & Remuneration Committee, provisions of the Companies Act 2013 & Clause 49 of the listing agreement, the Board has carried out an annual performance evaluation of its own & committees. 23. THE DETAILS OF DIRECTORS, KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR: Directors Appointed and Resigned : Mr. Sanjay Vaidya, Mr. Sanjay Asher and Mr. Noriyuki Watanabe were appointed as the Independent Directors of the Company with effect from 22nd September 2014 by the shareholders of the company in their 29th Annual general Meeting held on that date. Mr. Sanjay Asher & Mr. Noriyuki Watanabe have resigned as the Directors of the Company with effect from 30th September 2014. The Board places on record their sincere appreciation for the useful contribution made by Mr. Sanjay Asher and Mr. Noriyuki Watanabe during their tenure as a director of the Company. Mr. Prashant Asher & Ms. Bhumika Batra have been appointed as an Additional Director as well as an Independent Directors of the Company with effect from 11th November 2014 for a period of five years. In compliance with the provisions of Section 149 and Schedule IV of the Companies Act, 2013,the appointment of Mr. Prashant Asher and Ms. Bhumika Batra as the Independent Directors is being placed before the Members in the Annual General Meeting for their approval. In the opinion of the Board, they fulfill the conditions specified in the Companies Act 2013 and the Rules made there under for appointment as Independent Directors and are independent of the management. Members are requested to refer to the Notice of the Annual General Meeting and the Explanatory Statement for details of the qualifications and experience of the Directors and the period of their appointment. Members approval is sought for their appointment as an independent director of the company in the ensuing annual general meeting. Mr. Sanjay Vaidya has resigned as the Director of the Company with effect from 26th May 2015. The Board places on record their sincere appreciation for the useful contribution made by Mr. Sanjay Vaidya during his tenure as a director of the Company. Mr. Masahiko Nakagawasai's earlier tenure as an Executive Director & Chief Financial Officer of the Company concluded on 27th May 2015. He was re-appointed as an Executive Director as well as the Chief Financial Officer of the Company for a period of three years with effect from 28th May 2015. Mr.Masahiko Nakagawasai has resigned as an Executive Director as well as a Director of the Company with effect from 14th August 2015. His re-appointment as an Executive Director was made under Schedule-V of the Companies Act., 2013 and other applicable provisions thereto. The appointment and remuneration payable to Mr.Masahiko Nakagawasai as an Executive Director for the period- 28th May 2015 up to 14th August 2015 is subject to the approval of the members of the Company. The Board places on record their sincere appreciation for the useful contribution made by him during his tenure as an Executive Director and the Director of the Company. Mr.Sunil Kumar Sinha has resigned as the Chairman & Director of the Company with effect from 14th August 2015. The board places its sincere appreciation for the useful contribution made by Mr. Sunil Kumar Sinha during his tenure as the Chairman & Director of the Company. Mr. Kazunori Ajikawa has been appointed as an additional director of the Company with effect from 14th August 2015. He holds the office till the ensuing Annual General Meeting of the Company. A notice proposing appointment of Mr.Kazunori Ajikawa as a Director of the Company under section 160 of the Companies Act, 2013 has been received from the member of the Company. Key Managerial Personnel Designated during the Year: Mr. Tomio Isogai, - Managing Director, Mr. Masahiko Nakagawasai-Executive Director & Chief Financial Officer and Mr .Mayuresh Vaze- Company Secretary have been designated as the 'Key Managerial Personnel' of the Company with effect from 26th May 2014. Directors proposed to be re-appointed at the ensuing Annual general Meeting : In accordance with the provisions of the Companies Act, 2013, and the Articles of Association of the Company Mr. Tomio Isogai retire by rotation as a Director of the Company and being eligible he have offered himself for the reappointment. 24. THE NAMES OF THE COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURE OR ASSOCIATE COMPANIES DURING THE YEAR: There are no companies which have become/ ceased to be subsidiaries, joint ventures or associate companies during the year. 25. DEPOSITS Your Company has not accepted any Fixed Deposits during the year under review. 26. SIGNIFICANT AND MATERIAL ORDERS No significant material orders have been passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company and its future operations. 27. INTERNAL FINANCIAL CONTROLS Considering the nature and size of the business , the company has in place adequate internal financial controls. No reportable material weakness have been observed during scrutiny and testing. 28. INFORMATION FORMING PART OF THE DIRECTORS REPORT PURSUANT TO SECTION 197(12) OF THE COMPANIES ACT, 2013 AND RULE NO. 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014 : The relevant information required to be given under section 197(12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed at 'Annexure - D' to this Report. 29. COMPOSITION OF THE AUDIT COMMITTEE ETC.: Composition of the Audit Committee and other relevant information has been given in the section 'Corporate Governance'. 30. VIGIL MECHANISM /WHISTLE BLOWER POLICY: The Company has adopted a Vigil Mechanism / Whistle Blower Policy, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. During the year under review , the company has not received any complaints under the said mechanism. This policy has been posted on the website of the company- www.sharpindialimited.com 31. FAMILIARIAZATION PROGRAM : Familiarization program of independent directors of the Company is available on the website of the Company www.sharpindialimited.com 32. POLICY UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL ) ACT, 2013: In terms of the provisions of the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal ) Act, 2013 , the Company has formulated a policy to prevent sexual harassment of women at the workplace. During the year under review your company has not received any complaints of sexual harassment of women at the workplace and there were no cases filed pursuant to the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013 33. ACKNOWLEDGEMENTS: Your Directors express their gratitude for the valued and timely support and guidance received from Sharp Corporation, Japan and also wish to place on record their appreciation for the cooperation extended by the Bankers, Financial Institutions and its valued investors. The Board also acknowledges the untiring efforts and contribution made by the company's employees. For and on behalf of the Board of Directors Tomio Isogai Managing Director Masahiko Nakagawasai Executive Director DIN : 03426524 DIN : 05274985 Pune Date:14th August,2015 |